Connectivity – How It Changes Everything – Systems Innovation

While connectivity disrupts it is also the ground conditions for building something truly new. It enables us to shift from building systems based upon physical constraints to ones that are based upon the principles of connectivity, of networks, of systems. While at the same time it creates the new challenge of designing and building complex systems. When things are disconnected they are defined by their boundary conditions and internal structure but when we start to connect things they are shaped by their connectivity, their relations to others, the structure, and rules of the networks they form part of.

Manuel Castells puts it well when he says “the logic of the network is more powerful than the powers of the network.” This, in fact, summarizes the story of disruption for existing organizations by the new networked platforms. The logic of their networks has become more influential in shaping our world than of the existing centralized powers that previously dominated. As the connectivity proliferates, the resources flowing on those networks proliferate and the strength of those networks grows the same will be true for all organizations, both private and public.

Often we find that our organizations ignore the distributed nonlinear networks of connections that are proliferating around us, dismiss them until one day we wake up and we find that the resources flowing through those networks is much greater than what any one organization can command. The paradigm then suddenly flips and we find that our once powerful organization is now just one node within a much greater network and it is the logic of that network that really matters.

I think the story of the disruption of the media industry is one example of this – the New York Times now finding itself as just one voice among a vast network of the internet, bloggers, websites and social media. That is the problem with linear thinking, it leads us to focus only on big causes and blinds us to the nonlinear change processes that are happening and how over time they will sum up to something much greater than their parts alone to change the paradigm; at which point it is too late.

It is this transformation from things to connections that is really driving the transformation of our economies, and it is why the concept of services is so important in understanding the new economic paradigm forming. What Uber, Airbnb, and co. have done is to leverage that underlying transformation, to turn products into services – from things to connections, service processes that connect things. At the same time, we can note how the design challenge changes from building things to building systems and processes. As the connectivity becomes stronger those networks push out to interconnect more and more disparate things into larger and larger service systems and the key challenge shifts to that of designing complex service systems.

There are two widely divergent ways of thinking about how technology affects society. The technocratic view that posits that social outcomes are determined by technological changes, and the humanist perspective that posits that technology can’t change anything just accelerate existing patterns. I think both are partially correct and partially incorrect.

I think technology does not determine social outcomes but it does set the parameters for them. Technology makes things possible that were previously not possible and sets the context within which people make their decisions about what they will do, but the outcome of those decisions is not determined. Industrial technologies made new things possible and new patterns of social and economic organization emerged out of that based largely on what is viable given those technologies, but not everyone has chosen to live like that nor is the same path to industrialization determined for all the different societies and there are widely divergent outcomes, from dictatorships to democracies.

I think the same is true with the technologies of connectivity, it enables new possibilities but just like the industrial technologies they can lead to dictatorships or democracies. I think today everyone around the world is looking at these emerging networks and asking how can I have an influence on those or control the flow of resources on these emerging networks, whether that is from startups in Silicon Valley and Bangalore to hackers to the Chinese government, to each and every one of us as we post our tweets and hope that people will see and share them.

There is an “empire of networks” emerging that will change how we organize societies and economies around the world and in that is the possibility for systems change. It is precisely because of this infrastructure of connectivity that we today have the opportunity to innovate in whole systems, but the question is how will we use that opportunity.

This is why we need new ways of thinking because without it we will fail to grasp the new possibilities and realize them towards whole systems change, simply putting a veneer of technological change on top of the same underlying patterns as before. But not only do we need systems thinking to conceive of different ways of doing things it also has to be connected to the technical know how to actually build new systems based upon those principles – because if we don’t do that then someone else will build them eg Facebook or Google based upon the old logic. We need both the new ways of thinking and the technical means and both working synergistically to realize systems level innovation.